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Vertex Energy to buy Vertex Holdings.

MANews-(C)2009-2012

15 August 2012 - US industrial and commercial waste recycler Vertex Energy Inc (PINK:VTNR) unveiled on Wednesday an agreement to buy all the assets and liabilities of Vertex Holdings LP, a specialist in aggregation, re-refining and processing of distressed petroleum streams.

The deal involves Vertex Holdingsa[euro](tm) operations of transporting, storing, processing and re-refining petroleum products, crudes and used lubricants including its operating units Cedar Marine Terminals LP Crossroad Carriers LP Vertex Recovery LP and H&H Oil LP.

The agreement also includes the real-estate held by and B & S Cowart Family LP(B&S LP) and associated with H&H Oila[euro](tm)s oil operations, the buyer said.

Vertex Holdings and B&S LP are controlled by Vertex Energya[euro](tm)s chairman and CEO Benjamin P. Cowart, who owns 77% in Vertex Holdings and 100% in B&S LP. Its CFO Chris Carlson own 10% in Vertex Holdings.

The buyer views the deal as a critical step in its growth strategy, giving it scale and eliminating the related third party transactions with Vertex Holdings, board member David Phillips said.

Under the deal terms, the price to be paid by Vertex Energy includes USD14.8m (EUR12m) cash and assumed debt, 4.5m own common restricted shares and USD1.7m for the real-estate assets of B&S LP. Apart from this, it would also provide additional up to USD6.7m earn-outs, with the final price being subject to working capital adjustments. Vertex Energy will use debt to finance the deal, it said, adding it expected to complete it in September.

The business to be bought made revenues of around USD31m and EBITDA of USD6m last year.

Craig-Hallum Capital Group LLC and Mayer Brown LLP advised Vertex Energy, while Sedgwick LLP acted as advisor to Vertex Holdings and B & S Cowart Family LP.Country: USASector: Waste Management/Environment, Petroleum/Natural Gas/CoalTarget: B&S real estate, Vertex Holdings LPBuyer: Vertex Energy IncVendor: Chris Carlson, Benjamin P. Cowart, B&S LPDeal size in USD: 23.1mType: Corporate acquisitionFinancing: Cash & Stock, DebtStatus: AgreedBuyer advisor: Mayer Brown LLP, Craig-Hallum Capital Group LLCComment: Deal size includes cash price and assumed debt.

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Publication:M & A Navigator
Date:Aug 15, 2012
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